Australia’s top regulators overseeing Qantas are members of the airline’s exclusive Executive Chairman’s Lounge, according to recent revelations. Out of the seven commissioners of the Australian Competition and Consumer Commission (ACCC), five are privileged members of the invite-only lounge, including ACCC chair Gina Cass-Gottlieb and corporate watchdog Joseph Longo. The ACCC has taken legal action against Qantas, accusing the airline of false and misleading conduct for selling tickets for over 8,000 cancelled flights between May and July 2020. The regulatory body is seeking penalties of over $250 million against the airline. The Civil Aviation and Safety Authority (CASA), responsible for aviation safety regulation, also has three board members and three senior executives who are members of the lounge.
The Chairman’s Lounge, reserved for VIPs such as politicians, celebrities, and high-ranking business executives, offers luxury amenities including plush leather sofas, high-quality food, a complimentary bar, and a peaceful environment. Recently, three members of parliament admitted to maintaining memberships at the lounge while criticizing the airline for alleged misconduct during an episode of the ABC’s Q+A program. Former New South Wales Premier and High Commissioner to India Barry O’Farrell also admitted to holding a membership. These revelations raised further concerns about the close relationship between Qantas and the federal government. These issues coincide with Qantas announcing a $2.47 billion profit while implementing cost-cutting measures, claiming $900 million in JobKeeper benefits, and facing challenges in providing satisfactory customer service. Some of these cost reductions occurred when the airline terminated employees due to the COVID-19 pandemic.
On Wednesday, the High Court ruled that Qantas illegally terminated around 1,700 workers during this period. These affected employees will pursue compensation and penalties that could amount to hundreds of millions of dollars. Additionally, it was revealed that every High Court judge in Australia is a member of the Executive Chairman’s Lounge. Federal Nationals leader David Littleproud criticized Qantas, highlighting the fact that current CEO Vanessa Hudson served as the chief financial officer at the time of the terminations. He called out the airline for taking advantage of the crisis at the expense of its workers and demanded swift action from the board.
The High Court’s unanimous judgment dismissed an appeal from Qantas, upholding the Federal Court’s rulings that outsourcing baggage handlers, cleaners, and ground staff was illegal. The court found that Qantas had breached the Fair Work Act by outsourcing its ground operations, effectively circumventing collective bargaining rights. Former Qantas CEO Alan Joyce resigned earlier this month amid mounting scrutiny and challenges faced by the airline. Qantas, like many others in the aviation sector, suffered significant financial losses due to the pandemic.
Qantas responded to the High Court ruling, expressing regret for the impact the outsourcing decision had on affected employees and offering a sincere apology. The airline stated that a prior Federal Court ruling had ruled out reinstatement of workers but confirmed that penalties for the breach and compensation for relevant employees, taking into account redundancy payments already made by Qantas, would be considered. In recent times, Qantas has also faced criticism for attempting to block additional flights from Qatar Airways and for establishing an expiry date for $400 million in unused flight credits accumulated during the COVID-19 pandemic. Former CEO Alan Joyce faced tough questioning during a senate inquiry into these issues, ultimately leading to his resignation. Vanessa Hudson has taken over as the new CEO.
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